Crude oil tumbles lower
The price of crude oil is tumbling lower. The current prices trading down $3.40 or -4.68% at $69.27. The low price just reached $69.21.
Concerns about China’s growth started the ball rolling to the downside fundamentally. Technicals also contributed.
Looking at the hourly chart, the high price today at $73.36 took the price above the 100-hour moving average near $73.05. However, momentum could not be sustained, and the price then rotated below its 200-hour moving average (green line currently at $72.55).
Momentum increased further after the pair fell below the low price from last Thursday near $71. That level was tested today, initially found support buyers but was broken a few hours later.
The price low just reached – and is now broken through – the next target support near $69.40 (see red numbered circles). Sellers remain in firm control.
Having said that, the market is oversold (RSI is around 22 on the hourly chart). As a result, traders should be a little more cautious on the most recent break. It is hard to “catch a falling knife”, but traders have to keep an eye on the $69.40 level for a potential failed break..
On increased downward momentum, the next target will be I’d near the May 4 low at $67.48.